Case Law Details
ACIT Vs Real Marketing Private Limited (ITAT Ahmedabad)
ITAT Ahmedabad held that in the proceedings under section 153A of the Act, the assessment can only be made based on incriminating materials found/ collected during the search from the premises of the assessee. Addition unsustainable no material of incriminating nature was found from the premises of the assessee.
Facts- The assessee is a private company and claimed to be engaged in the business of Investment, financing and renting of immovable property. There was a search action under section 132 of the Act dated 04-12-2014 carried out at the premises of “Barter/ Accommodation Entry Provider Group” and the assessee being part of the group was also subject to such search proceedings. As a result of the search, the proceedings under section 153A of the Act were initiated vide notice dated 11-08-2015 and in response to which the assessee declared income at Rs. NIL in the return filed under section 153A of the Act.
AO during the assessment proceedings under section 153A of the Act found that the assessee over the period has received accommodation entry in the form of share capitals along with premium from the entities controlled and managed by the entry provider namely Shri Shrish Chandrakant Shah and Shri Parveen Kumar Jain. AO treated the credit of Share capital along with premium received during the year under consideration for Rs. 2,79,50,000/- as unexplained cash credit under section 68 of the Act and added to the total income of the assessee. The AO also worked out expenses incurred for taking such accommodation entries of shares capital and premium @ 2% i.e. Rs. 5,59,000/-added to the total income of the assessee u/s. 69C of the Act.
On appeal by the assessee, the learned CIT(A) deleted that the addition made by the AO by holding that no material of incriminating nature was found from the premises of the assessee. The material found from the premises of third cannot be utilized against the assessee for making assessment u/s. 143(3) r.w.s. 153A of the Act. Being aggrieved, revenue has preferred the present appeal.
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